Part 4Transfer pricing
CHAPTER 4Position, if only one affected person potentially advantaged, of other affected person
Claim by affected person who is not advantaged
175Claims under section 174 where actual provision relates to a security
(1)
A claim under section 174 may not be made if—
(a)
the participation condition (see section 148) would not be satisfied but for section 161 or 162,
(b)
the actual provision is provision in relation to a security issued by one of the affected persons (“the issuer”), and
(c)
a guarantee is provided in relation to the security by a person with whom the issuer has a participatory relationship.
(2)
For the purposes of subsection (1), one person (“A”) has a “participatory relationship” with another (“B”) if—
(a)
one of A and B is directly or indirectly participating in the management, control or capital of the other, or
(b)
the same person or persons is or are directly or indirectly participating in the management, control or capital of each of A and B.
(3)
In subsections (1)(b) and (4)(a) “security” includes securities not creating or evidencing a charge on assets.
(4)
For the purposes of subsection (1)(b), any—
(a)
interest payable by a company on money advanced without the issue of a security for the advance, or
(b)
other consideration given by a company for the use of money so advanced,
is to be treated as if payable or given in respect of a security issued for the advance by the company, and references to a security are to be read accordingly.
(5)
The reference in subsection (1)(c) to a guarantee includes—
(a)
a reference to a surety, and
(b)
if the issuer is a company, a reference to any other relationship, arrangements, connection or understanding (whether formal or informal) such that the person making the loan to the issuer has a reasonable expectation that in the event of a default by the issuer the person will be paid by, or out of the assets of, one or more companies.